SOL Guyana ordered to pay billions in taxes

GEORGETOWN, Guyana, CMC – The High Court on Friday ordered the local branch of SOL Group, a major distributor of Shell’s fuels, to pay GY$2,196,908,802 (One Guyana dollar=US$0.004 cents) with interest on 54,878,817 litres of fuel that was purportedly imported for ExxonMobil Guyana’s operations but was not delivered.
Justice Nareshwar Harnanan also said SOL has to pay the Guyana Revenue Authority (GRA) GUY$3 million in fixed costs on or before the July 31, 2025.
In terms of the interest, the court said that it must be calculated on the taxes that must be paid at the rate of 6% per annum from the date of filing in 2022 to May 9, 2024, and thereafter at the rate of 4% per annum from May 9, until fully paid.
The judgment states that the GRA alleged that the 54,878,817 million was neither delivered to ExxonMobil Guyana nor was it properly accounted for and so cannot be exempted from taxes
Only ExxonMobil Guyana, previously named Esso Exploration and Production Guyana Limited (EEPGL), can benefit from the taxes.
The judgement states that the issue centered on a consignment of fuel amounting to 202,829,427 litres, which was imported into Guyana by SOL Guyana.
The GRA had challenged the amount of taxes paid by SOL Guyana on the volume of fuel imported based on their assessment that only 147,950,610 litres of fuel was delivered to Esso Guyana.
The Claimant had alleged that the remaining 54,878,817 litres of fuel was neither delivered to EEPGL nor has it been properly accounted for, and so does not qualify for any tax exemption which is only for the benefit of EEPGL
On June 27, 2016, the Guyana government and EEPGL entered into a Production Sharing Agreement, which allowed EEPGL to receive the benefit of a partial tax exemption on imported fuel at a rate of 10 percent.
In 2020, SOL Guyana after sending a letter specifically requesting the exemption owing to their status as importers of petroleum for Esso Guyana, was granted a concession to import fuel for the benefit of Esso Guyana at the exempted rate.
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